Frequently Asked Questions

Yes, for all intents, when it comes to export, trade and financial compliance—with which businesses in both the U.S. and abroad have the obligation to comply—those commonly-used terms can be considered relatively interchangeable.

Other terms common in the export compliance industry include: debarred party screening, OFAC screening, watch list screening, sanctions screening, embargoed country screening, Sanctioned Party List Screening (SPL), and Specially Designated Nationals (SDN) and Blocked Persons screening.

However, while similar in nature, there are some differences, primarily in that some terms are associated with specific regulations:

Yes, for many reasons. Chief among them is the fact that OFAC sanctioned entities don’t have to be foreign nationals or organizations—many U.S. individuals and companies are on OFAC lists. Even if you are only conducting business in the United States, there is a chance you could violate OFAC regulations if you don’t perform OFAC sanctions list searches.

The International Traffic in Arms Regulations (ITAR) is enforced by the United States government via the United States Munitions List (USML). Items on the USML are defense and military-related goods and technology, and require a license or an exemption in order to be lawfully exported.

The Export Administration Regulations (EAR) are administered by the Bureau of Industry and Security (BIS). The EAR controls goods and technology that have commercial applications, but may also have military uses (i.e., dual use goods). Technology and goods are controlled by the EAR for a variety of reasons, including anti-terrorism, national security, foreign policy, and nuclear proliferation. These goods similarly require licenses, or exceptions, to be lawfully exported.

If an item falls under the EAR or ITAR, a license is needed in order to export. Licenses are limited by time, value, or number of exports, and must be renewed upon expiry.

For items under the EAR, there are multiple categories of license exceptions. Should your organization’s goods qualify for these, you may not need an export license. The exceptions apply to limited cases, including public domain information, fundamental research, and educational information. If the items are on the CCL, and designated EAR99 (see below), they may not require a license unless they are being exported to an embargoed country or a restricted party.

For items on the USML, there are countries that may be exempt from needing licenses. Broad USML exemptions are largely blocked by the United States government in consideration of national security. However, there have been exemptions made for scientific research, and smaller scale exemptions arising from treaties in the past.

In the United States, there are three primary U.S. government bodies that regulate exports:

Additionally, other countries and international organizations, such as the European Union, have their own departments enforcing export controls aligned with their policies and goals.

If an item is covered by the CCL or USML, and your organization cannot get a license, exception, or exemption, you will be unable to legally export said item.

Should your organization determine that your exports are covered by either the EAR or ITAR, you must either apply for the appropriate license, determine whether they come under the purview of an exemption (ITAR) or determine if it is possible to get an exception (EAR).

Any organization doing business in the United States, or with American citizens or organizations, has a legal obligation to meet American export compliance requirements, regardless of whether or not they are based in the U.S. Any transactions conducted in the U.S. dollar, or routed and processed through American financial institutions, come under the purview of OFAC. Additionally, organizations may also be bound by the export compliance regulations of the countries they are based out of and do business in.

Exports do not necessarily have to involve the physical transfer of goods or information out of the country. If, for example, controlled information is transmitted or exposed to a foreign national via electronic means, it counts as a “deemed export”, even if said foreign national resides in the United States. Any organization can fall foul of deemed export violations, with educational institutions and research facilities known to be at high risk for such violations—inadvertent or otherwise.